Accounting Information Systems

The chart of accounts of LR Company includes the following selected accounts.
112 Accounts Receivable
120 Merchandise Inventory
126 Supplies
157 Equipment
201 Accounts Payable
401 Sales
412 Sales Returns and Allowances
505 Cost of Goods Sold
610 Advertising Expense

In July the following selected transactions were completed. All purchases and sales were on account. The cost of all merchandise sold was 70% of the sales price.

July 1Purchased merchandise from Eby Company $8,000.
2Received freight bill from Shaw Shipping on Eby purchase $400
3Made sales to Fort Company $1,300 and to Hefner Bros. $1,500.
5Purchased merchandise from Getz Company $3,200.
8Received Credit on merchandise returned to Getz Company $300.
13Purchased store supplies from Dayne Supply $720.
15Purchased merchandise from Eby Company $3,600 and from Bosco Company $4,300.
16Made sales to Aybar Company $3,450 and to Hefner Bros. $1,870.
18Received bill for advertising from Welton Advertisements $600.
21Sales were made for Fort Company $310 and to Duncan Company $2,800.
22Granted allowance to Fort Company for merchandise damaged in shipment $40.
24Purchased merchandise from Getz Company $3,000.
26Purchased equipment from Dayne Supply $900.
28Received freight bill from Shaw Shipping on Getz purchased of July 24, $380.
30Sales were made to Aybar Company $5,600.

Instructions

  1. Journalize the transactions above in a purchased journal, a sales journal, and a general journal. The purchases journal should have the following column headings: Date, Account Credited (Debited), Ref., Accounts Payable Cr., Inventory Dr., and Other Accounts Dr.
  2. Post to both the general and subsidiary ledger accounts. (Assume that all accounts have zero beginning balances.)
  3. Prove the agreement of the control and subsidiary accounts.

Solution

a.
LR Company
 
LR Company
 
LR Company
 
b.
 
LR Company
(General Ledger)
 
LR Company
Accounts Receivable Subsidiary Ledger
 
LR Company
Accounts Payable Subsidiary Ledger
c.
 
LR Company
Proof of Agreement (Accounts Receivable)
 
LR Company
Proof of Agreement (Accounts Payable)
 
Are you need any help? Contact Us now.

Latest Articles

« »